Sundaram Alternates Exits Second Realty Fund with 17% IRR, Delivers 40 Exits in 8 Years

New Delhi, October 6, 2025: Alternative investment arm of the Sundaram Finance Group, Sundaram Alternates (SA), has announced the successful closure of its second real estate credit fund – Sundaram Alternative Opportunities Series – High Yield Secured RE Debt Fund II (SA RE Credit Fund II). The fund delivered a gross investor IRR of 17 per cent post exiting its portfolio investments in its approximately INR 435-crore SA RE Credit Fund II.

SA RE Credit Fund II invested its entire portfolio in fully secured, high-yielding debentures issued by Indian real estate developers. The fund’s strategy was focused on projects in key South Indian micro markets.

The fund pursued a highly disciplined credit strategy with a diverse capital allocation, a risk-adjusted approach to underwriting, de-risked brownfield projects backed by consistent sponsor commitments of over 15 per cent, and delivering a zero capital losses track record even through challenging market cycles between 2019 and 2023, including the COVID period.

This successful exit marks another milestone for SA’s flagship real estate credit strategy. The platform has recorded 38 complete exits and over 10 partial exits aggregating to over INR 2,600 crore over the past eight years. In this period, the platform has built a strong track record of over 70 deals through 4 real estate credit funds across sector cycles, despite materially adverse economic events that include two COVID waves, the NBFC crisis, etc. SA’s underwriting resilience is further evidenced by the portfolio’s cash generation. The SA RE credit portfolio currently generates an annual cash yield of about 15-16 per cent for its investors and the funds have not missed a single quarter’s income distribution since its inception.

Commenting on the development Sundaram Alternates Director Karthik Athreya said, “The successful closure and exit of SA RE Credit Fund II underscores our commitment to delivering strong risk-adjusted returns while prioritizing capital protection. Our disciplined investment approach and unique underwriting methodology have enabled investors to achieve consistent, quarterly cash yields even during challenging market conditions. With increasing institutionalisation of private credit, interesting opportunities and a growing appetite for risk-adjusted returns from Indian investors, we believe this is a defining decade for private financing in India—and our goal is to position Sundaram Alternates as a dependable and trusted partner to investors as they allocate to these asset classes.”